According to the results of a J.D. Power and Associates study, the first thing many people do after going through the automobile claim process is search for a new insurance company.
J.D. Power's report, the 2006 Collision Repair Satisfaction Study, illustrates the importance and impact of customer service in the insurance industry. Its conclusions show that nearly one out of every five customers considers switching insurance companies after dealing with getting a car repaired. According to 62 percent of respondents, claims/estimation is the single most important factor that drives customer satisfaction with the repair process. Two other factors — body shop and rental car — made up 36 percent and 2 percent, respectively.
The study also reported that seven percent of customers chose not to file a claim with their insurer after their most recent collision. Common reasons include: the insurance deductible was more than the cost of the repairs; concern that the carrier would increase the premium after the claim; or at the advice of their insurance agent.
But it appears at least one of these fears is unfounded. The study reported that more than 30 percent of auto insurance customers who chose not to file a claim after a collision did so because they feared their premiums would increase. However, 62 percent of respondents who did file a claim more than six months prior to being surveyed indicated that their premiums had not been readjusted by their insurer, according to the study.
Clear communication appears to be the key to success in keeping claimants satisfied. In cases where vehicles were totaled out rather than repaired, the study found that claimants were significantly more satisfied if their insurer gave them a clear explanation of why the vehicle was totaled and how they calculated the settlement amount. The study reported that nearly 85 percent of total-loss claimants received an explanation of why their vehicles were being totaled and how their actual cash value settlement was derived.
"Filing an insurance claim is a critical moment of truth that shapes a customer's overall perception of their insurer," said Jeremy Bowler, senior director of the insurance practice at J.D. Power and Associates, in a release. "Misconceptions about what is covered by the auto policy, or what to expect during the claim and repair processes can lead to significantly lower customer satisfaction, which in turn increases the likelihood that the customer may consider switching carriers in the future."
The study was based on responses from 5,752 customers who have had collision damage repaired on their vehicles or had a total loss within the past 12 months.
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